PUBLIC ADMINISTRATION DIGITALIZATION AND CORRUPTION IN THE EU MEMBER STATES. A COMPARATIVE AND CORRELATIVE RESEARCH ANALYSIS.

• Author: Androniceanu, Armenia

1. Introduction

   Globally, not only the economy but also public administration and society are influenced by technological transformations. Countries that do not prioritize the cross-cutting integration of digital technology at all levels of the economy, public administration, and society will suffer. Beyond efficiency, the digitalization of public services in developed countries in Europe and beyond sends a strong signal at the international, national, and local level on the need for change and digital transformation to move into an era of transparency, quality of public services, and the fight against corruption. The ongoing digital revolution has changed the frame of contemporary economies, modern businesses, and public administration by promoting and implementing new technological solutions for digitalization (Rymarczyk, 2021). The modernization of public administration and services as a result of the integration of information and communication technologies is essential and should become a continuing concern of state governments (Mansell, 2012). In countries where these changes occurred, they have been proven to be an effective way to reduce corruption (Mouna, Nedra and Khaireddine, 2020). The digitalization of public institutions increases the level of efficiency and transparency and should be one of the key pillars of the development of any smart community (Vogelsang, 2010; Sandor, 2018). Through digitalization, the entire activity of public institutions is streamlined on all three levels: internally, intra-institutionally, and externally (Afonasova et al., 2019). Digitalization increases the transparency and accountability to citizens of the authorities (Balzer, Uzik and Glova 2020); transparency and openness of public institutions are essential for a democratic society.

   Corruption is an obstacle both for economic growth and for good public administration. By transferring resources outside the economic and social system, the efficiency of public spending is significantly affected (Winston, 1998). Although the EU has shown the best performance in the world in reducing corruption during the last years, the corruption costs for the EU economy are estimated at EUR 120 billion per year (European Commission, 2020). Corruption plays a role in discouraging taxpayers from paying taxes (Osipov, Glotov and Karepova, 2018). Decreasing resources as a result of corrupt practices may have negative effects on social protection and public services as it reduces the available budget and disrupts equitable access to public services (Raisiene et al., 2019; Mazzanti et al., 2020).

   Over time, corruption deepens social inequalities, reduces trust in the state, institutions, and public administration (Cera et al., 2019). Corruption can also harm income distribution and lead to the neglect of environmental protection. One of the most important aspects of corruption in the state administration is that it undermines trust in legitimate institutions, thus diminishing their ability to provide appropriate public services and to ensure a favorable environment for private sector development (Mircica, 2020). In extreme cases, corruption can lead to a failure to recognize the legitimacy of the state, causing political and economic instability (Bilan et al., 2019; Bilan et al., 2020; Grayson, 2020).

   In this research, we analyze not only the phenomenon of corruption in the administrations of the EU states but also how the digitalization of the EU state administrations contributed in time to its continuous reduction. Our research objective is to find out how digitalization as a multidimensional phenomenon has influenced the multidimensional phenomenon of corruption in the administrations of the EU states. The results of other researchers (Fedushko et al., 2020; Anderson, 2008; Chaikin and Jason, 2009; Aidt, 2009; Billger and Goel, 2009) are completed with our findings in the EU countries by studying the interdependencies of the following variables: control of corruption; competitiveness; government effectiveness; online services index; e-government; government expenses; e-participation and others.

   The paper includes an analysis of the literature, in which the concepts are presented and analyzed, based on which the main variables of the research were selected. Then the data and the research methodology are presented and the results obtained using the Canonical Correlation Analysis are analyzed. Next, the Principal Component Analysis method was applied to determine a new Correlation Index for Corruption and Digitization (CICD), calculated for each of the states included in our research. The last part of the paper contains the conclusions in which our most important and interesting contributions to the field of knowledge are highlighted.

2. Theoretical background

   Digitalization is a necessary condition for economic and social development, for alignment with international standards, and reduced corruption (Pool, 1984; Afonasova et al., 2019; Dretske, 1982). The low degree of digitalization in the administration creates room for corruption because the relationship between digitalization and corruption is not always well enough understood (Andersen, 2009). Digitalization requires an agile government to disrupt corruption.

   The first part of this section presents the concept of digitalization, in general, and in public administration, in particular, its main benefits and the implications of a low level of digitalization in society and state administrations. The second part describes the content of corruption, as it is reflected in the literature, its implications in public administration, its main determinants, and some measures to reduce corruption in administration through the digital transformation of state institutions and society.

   2.1. Digitalization and digital transformation process: Concepts and main benefits

   According to the literature, there is a diversity of opinions regarding this concept. Digitization is a driver (Russell, 2020) that contributes significantly to the modernization of societies, economies, and the transformation of state institutions (Bennett and Segerberg, 2013). Digitalization is a tool which leads to better predictability (Kliestik et al., 2020). Based on Kossow's (2020) empirical research results, digitalization creates new digital streams by using digital technologies. Digitalization is a strategy that reshapes the entire society and each organization, leading to an extensive process of digital transformation. Digitalization determines digital transformation. Digital transformation is the process of integrating digitalization through which society and organizations adapt to change. Digital transformation is more about adapting people to accept and use digital equipment and technology (Androniceanu, Sabie and Pegulescu, 2020). Major social, administrative, and legislative changes are taking place in the process of digital transformation. Digital transformation of the public sector has implications in all branches of society from jobs, education, health, and social security (Karpf, 2012; Gray-Hawkins and Lazaroiu, 2020). The digital transformation of public institutions facilitates e-government.

   E-government is a process of reinventing the public sector through digitalization and new information management techniques, to increase the political participation of citizens and streamline the administrative apparatus (Coursey and Norris, 2008; Ionescu, 2020). E-government manifests itself as part of the relationship between the state and society (Androniceanu, Kinnunen and Georgescu, 2020). Increasing the number of digital public services available (alusarczyk and U1 Haque, 2019) means lower costs for public administrations, less bureaucracy for companies and citizens, and reduced corruption. At the European level, about twenty different basic public services, such as car registration, tax returns, or registering a new company, have reached the online availability of 82% since 2010 (DeNardis, 2014). Digitalization and e-government are broadly studied issues (Androniceanu and Georgescu, 2021), but there is still no clear consensus on the factors that should be considered, when measuring e-government and how they should be grouped and quantified. Mouna, Nedra and Khaireddine (2020) show that successful e-government and digital technology adoption will lead to increased economic growth, while also working as an anti-corruption tool (Popescu, Valaskova and Majerova, 2020). Shkolnyk et al. (2020) prove that digitalization is an effective measure that has a significant contribution to eradicating corruption as a problem of state security. Mishchuk et al. (2020) find possibilities to assess losses both for the state finance system and social safety. Makowski (2017) discusses how the public authorities and public administration by their functions and digitalization can reduce the bureaucracy of public structures (Shkarlet et al., 2020).

   In local public administration, digitalization and digital transformation contribute to increasing accessibility, transparency, and efficiency and reducing bureaucracy and corruption. There is a direct correlation between digitization and efficiency, both for public institutions and for other stakeholders. Even if, in the first phase, digitalization means public spending on digital investments and training of civil servants, in the medium and long term it generates efficiency by reducing public spending on bureaucracy and optimizing working time, and by improving communication and public services quality. Efficiency is represented in our research by the government effectiveness index.

   Digitalization brings benefits in local public administration both for public institutions and for civil servants and other stakeholders. Some of the most important benefits are presented here. Digitization of public administration facilitates the interaction between local public administration and...